Changes from report parliamentary committee draft to plenary report

RemovedArticle 1 – paragraph 1 – point 75 – point a, Article 162 – paragraph 1 – subparagraph 2: Alternatively, as part of the permission referred to in Article 143, the competent authorities may decide on whether all institution shall use the maturity value M as set out in paragraph 2 for all those exposures or for a subset of those exposures.;

Added'(m) the applicable amount of insufficient coverage for non-performing exposures other than exposures purchased by a specialised debt restructurer which were non-performing at the time of purchase.’;

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Added(11) in Article 46(1), in point (a), point (ii) is replaced by the following:

RemovedArticle 1 – paragraph 1 – point 75 – point b – point ii, Article 162 – paragraph 2 – point db: (db) for a master netting agreement including more than one of the transaction types corresponding to points (c), (d) or (da), M shall be the weighted average remaining maturity of the transactions where M shall be at least the longest holding period (expressed in years) applicable to such transactions as provided in Article 224(2) (either 10 days or 20 days, depending on the cases). The notional amount of each transaction shall be used for weighting the maturity;

Added‘(ii) the deductions referred to in Article 36(1), points (a) to (g), points (k)(ii), (iii) and (iv) and points (l), (m) and (n), excluding the amount to be deducted for deferred tax assets that rely on future profitability and arise from temporary differences;’;

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Added(11a) in Article 47a, the following paragraphs are added:

RemovedArticle 1 – paragraph 1 – point 75 – point b – point iv, Article 162 – paragraph 2 – point i: (i) for institutions using the approaches referred to in Article 382a(1), points (a) or (b), to calculate own fund requirement for CVA risks of transactions with a given counterparty, M shall be no greater than 1 in the formula laid out in Article 153(1), point (iii), for the purposes of calculating the risk-weighted exposure amounts for counterparty risk for the same transactions, as referred to in Article 92(4), points (a) or (f), as applicable;;

Added'7a. For the purposes of Article 36(1), point (m), "specialised debt restructurer" means an institution that, during the preceding financial year, complies with all of the following conditions :

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Added(i) the main activity of the institution is the purchase of exposures of other institutions and its management body has implemented a clear and effective internal decision process to this end;

RemovedArticle 1 – paragraph 1 – point 75 – point b – point v, Article 162 – paragraph 2 – point j: (j) For revolving exposures, M shall be determined using the maximum contractual termination date of the facility. Institutions shall not use the repayment date of the current drawing if this date is not the maximum contractual termination date of the facility.;

Added(ii) the book value of its own originated loans does not exceed 15% of the aggregate book value, including purchased performing and non-performing exposures, of its loans; and

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Added(iii) its total assets do not exceed EUR 30 billion.

RemovedArticle 1 – paragraph 1 – point 75 – point c – point ii – indent 1, Article 162 – paragraph 3 – subparagraph 2 – point b: (b) self-liquidating short-term trade finance transactions connected to the exchange of goods or services as referred to in Article 4(1), point (80), and corporate purchased receivables, provided that the respective exposures have a residual maturity of up to one year;

Added7b. EBA shall, taking into account the criteria set out in points (i) to (iii) of paragraph 7a, develop draft regulatory technical standards specifying the conditions under which an institution may be considered a specialised debt restructurer.

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AddedEBA shall submit those draft regulatory technical standards to the Commission by [12 months after the date of entry into force of this amending Regulation].

RemovedArticle 1 – paragraph 1 – point 75 – point c – point ii – indent 2, Article 162 – paragraph 3 – subparagraph 2 – point e: (e) issued as well as confirmed letters of credit that are short term, namely they have a maturity below one year, and are self-liquidating.;

AddedPower is delegated to the Commission to adopt the regulatory technical standards referred to in the first subparagraph in accordance with Articles 10 to 14 of Regulation (EU) No 1093/2010.';

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Added(11b) Article 47c is amended as follows:

RemovedArticle 1 – paragraph 1 – point 75 – point d, Article 162 – paragraph 4: 4. For exposures to corporates established in the Union which are not large corporates as defined in Article 142(1), point (5a), competent authorities shall decide on whether all institutions shall set M for all of those exposures as set out in paragraph 1 instead of applying paragraph 2.;

Added(a) in paragraph (4), point (b) is replaced by the following:

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Added‘(b) 1 for the secured part of the non-performing exposure to be applied as of the first day of the eighth year following its classification as non-performing, unless the guarantee or insurance has been invoked by the institution and the eligible protection provider has assumed and, in line with Article 213(1), fulfils all payment obligations of the obligor towards the institution in full and in accordance with the applicable payment schedule, in which case a factor of 0 for the secured part of the non-performing exposure will apply.’;

RemovedArticle 1 – paragraph 1 – point 76 – point a, Article 163 – paragraph 1 – introductory part: 1. For the sole purposes of calculating risk-weighted exposure amounts and expected loss amounts of those exposures, and in particular for the purposes of Article 154, Article 157 and Article 158, paragraphs 1, 5 and 10, the PD for each retail exposure that is used in the input of the risk weight and expected loss formulas shall not be less than the one-year PD associated with the internal borrower grade to which the retail exposure is assigned and the following:

Added(b) the following paragraph is inserted:

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Added‘4a. By way of derogation from paragraph 3 of this Article, the part of the non-performing exposure guaranteed or insured by an official export credit agency are excluded from the requirements laid down in this Article.’;

RemovedArticle 1 – paragraph 1 – point 77 – point c, Article 164 – paragraph 4 - introductory part: 4. For the sole purpose of calculating risk-weighted exposure amounts and expected loss amounts for retail exposures, and in particular pursuant to Article 154(1), point (ii), Article 157 and Article 158(1), (5) and (10), the LGD for each exposure used as an input of the risk weight and expected loss formulas shall not be less than the LGD input floor values laid down in Table 2aa and in accordance with paragraph 4a:

Added(12) in Article 48, paragraph 1 is amended as follows:

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Added(a) in point (a), point (ii) is replaced by the following:

RemovedArticle 1 – paragraph 1 – point 77 – point d, Article 164 – paragraph 4a – point b: (b) except for retail exposures secured by residential property, the LGD input floors in paragraph 4, Table 2aa shall be applicable to exposures fully secured with FCP where the value of the FCP, after the application of the relevant volatility adjustments in accordance with Article 230, is equal to or exceeds the exposure value of the underlying exposure;

Added‘(ii) Article 36(1), points (a) to (h), points (k)(ii), (iii) and (iv) and points (l), (m) and (n), excluding deferred tax assets that rely on future profitability and arise from temporary differences.’;

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Added(b) in point (b), point (ii) is replaced by the following:

RemovedArticle 1 – paragraph 1 – point 77 – point d, Article 164 – paragraph 4a – subparagraph 1 a (new): For the purposes of point (b), the type of FCP "Other physical collateral" in Table 2aaa of Article 230 shall be understood as "Other physical and other eligible collateral".

Added‘(ii) Article 36(1), points (a) to (h), points (k)(ii), (iii) and (iv) and points (l), (m) and (n), excluding deferred tax assets that rely on future profitability and arise from temporary differences.’;(13) in Article 49, paragraph 4 is replaced by the following:

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Added‘4. Holdings in respect of which deductions are not made pursuant to paragraph 1 shall always qualify as exposures and shall be risk weighted in accordance with Part Three, Title II, Chapter 2 of this Regulation.

RemovedArticle 1 – paragraph 1 – point 77 – point d, Article 164 – paragraph 4b: deleted

AddedThe holdings in respect of which deduction is not made in accordance with paragraphs 2 or 3 shall qualify as exposures and shall be risk weighted at 100 %.’;

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Added(14) in Article 60(1), in point (a), point (ii) is replaced by the following:

RemovedArticle 1 – paragraph 1 – point 79 – point a, Article 166 – paragraph 8 – subparagraph 2: Where only the drawn balances of revolving facilities have been securitised, institutions shall ensure that they continue to hold the required amount of own funds against the undrawn balances associated with the securitisation.

Added‘(ii) Article 36(1), points (a) to (g), points (k)(ii), (iii) and (iv) and points (l), (m) and (n), excluding deferred tax assets that rely on future profitability and arise from temporary differences;’;

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Added(15) in Article 62, first subparagraph, point (d) is replaced by the following:

RemovedArticle 1 – paragraph 1 – point 79 – point a, Article 166 – paragraph 8 – subparagraph 3: An institution that has not received permission to use IRB-CCF for an off-balance sheet item, shall calculate the exposure value as the amount specified in paragraph 8a multiplied by the SA-CCF concerned.

Added‘(d) for institutions calculating risk-weighted exposure amounts under Chapter 3 of Title II of Part Three, the IRB excess where applicable, gross of tax effects, calculated in accordance with Article 159 up to 0,6 % of risk-weighted exposure amounts calculated under Chapter 3 of Title II of Part Three.’;

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Added(16) in Article 70(1), in point (a), point (ii) is replaced by the following:

RemovedArticle 1 – paragraph 1 – point 79 – point a, Article 166 – paragraph 8 – subparagraph 4: An institution that uses IRB-CCF, shall calculate the exposure value for undrawn commitments as the undrawn amount multiplied by an IRB-CCF.;

Added‘(ii) Article 36(1), points (a) to (g), points (k)(ii), (iii) and (iv) and points (l), (m) and (n), excluding the amount to be deducted for deferred tax assets that rely on future profitability and arise from temporary differences;’;

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Added(17) in Article 72b(3), first subparagraph, the introductory phrase is replaced by the following: